TaxTMI 
TaxTMI 
2022 (12) TMI 1054
X X X X Extracts X X X X
X X X X Extracts X X X X
....arty' to the 'Proceedings', before the 'Adjudicating Authority', (`National Company Law Tribunal', Hyderabad Bench, Hyderabad) in IA/746/2021 in CP (IB) No.326/7/HDB/2020, as the 'impugned order', pertains to the 'Approval' of the 'Resolution Plan', submitted by the 2nd Respondent. 3. It is the stand of the 'Petitioner' / 'Appellant' that it is the 'Statutory Authority' and 'Creditor' to the 'Corporate Debtor' and the 'grievance' of the 'Petitioner' / 'Appellant' is that its 'Claim', was 'not paid', 'in entirety' and 'in priority', in the 'Resolution Plan', and hence, the 'Petitioner' / 'Appellant' prays for 'Allowing' IA/471/2022 in Comp. App. (AT)(CH) (INS) No.215/2022. 4. Considering the fact that the 'Petitioner' / 'Appellant' is 'not a Party' to the 'Proceedings', before the 'Adjudicating Authority', (`National Company Law Tribunal', Hyderabad Bench, Hyderabad) in IA/746/2021 in CP (IB) No.326/7/HDB/2020, and in view of the grievance of the 'Petitioner' / 'Appellant', that it was 'not paid' in 'Full', and in 'Priority', in the 'Resolution Plan', this 'Tribunal', grants 'Leave' to the 'Petitioner' / 'Appellant', to prefer the instant Comp. App. (AT)(CH) (INS) No.215/2022 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tes cast in favour of Approval of Resolution Plan. 17. In K Sashidhar Vs. Indian Overseas Bank & Others, decided on 05.02.2019 in Civil Appeal No.10673/ 2018 with CA Nos.10719/2018, 10971/2018 and SLP(C) No.29181/2018, the Hon'b1e Supreme Court, noticing the provisions of section 30(4), held that if the CoC had approved the reso1ution plan by requisite percent of voting share, then as per section 30(6) of the Code, it is imperative for the resolution professional to submit the same to the adjudicating authority (NCLT). On receipt of such a proposal, the adjudicating authority (NCLT) is required to satisfy itself that the resolution plan as approved by CoC meets the requirements specified in Section 30(2). No more and no less. 18. In the said judgment, in para 35, the Hon'ble Supreme Court held that the discretion of the adjudicating authority is circumscribed by Section 31 and is limited to scrutiny of the resolution plan "as approved" by the requisite percent of voting share of financial creditors. Even in that enquiry, the grounds on which the adjudicating authority can reject the resolution plan is in reference to matters specified in Section 30(2) when the res....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... and Sons Private Limited Versus Edelweiss Asset Reconstruction Company Limited. 22. Accordingly, the MoA and AoA shall be amended and filed with the RoC for information and record as prescribed. While approving the 'Resolution Plan', as mentioned above, it is clarified that the Resolution Applicant shall pursuant to the Resolution Plan approved under Sub-Section (1) of Section 31 of the I&B Code, 2016, obtain all the necessary approvals as may be required under any law for the time being in force within the period as provided for in such law. Etc.," and 'disposed of' the 'Interlocutory Application'. Appellant's contentions: 7. Challenging the 'impugned order' in IA No.746/2021 in CP (IB) No.326/7/HDB/2020 passed by the 'Adjudicating Authority', (National Company Law Tribunal, Hyderabad Bench, Hyderabad), the Learned Counsel for the 'Appellant' / 'EPFO' submits that the 'Corporate Debtor', is 'Chronic Defaulter', and had 'not paid' the 'EPF dues', promptly and had committed 'default', in payment of certain 'EPF dues' / 'damages' / 'interest', including the 'Employees' share of contributions', for the period from 08/199 to 02/2021, amounting to Rs.40,09,102/-. 8....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the 2nd Respondent was approved by the 'Committee of Creditors', and the same was submitted before the 'Adjudicating Authority', (National Company Law Tribunal, Hyderabad Bench, Hyderabad) for getting an 'Approval', which was approved, through an 'Order' dated 10.01.2022. 13. The 'Grievance of the Appellant', is that the '2nd Respondent' / 'Resolution Applicant', in the 'Resolution Plan', had provided for 2.51% of the amount, admitted to all the 'Operational Creditors' of the 'Corporate Debtor', and 'allotted' a total amount of Rs.20,00,000/- to 'pay off' 'Debts', towards the 'Operational Creditor'. In fact, the 1st Respondent through an 'E-mail' dated 04.02.2022 had intimated the 'Appellant', about the 'approval' of the 'Resolution Plan', attaching the 'impugned order', mentioning that it was uploaded on the website of the 'Adjudicating Authority', (National Company Law Tribunal, Hyderabad Bench, Hyderabad), only on 04.02.2022, etc. 14. According to the 'Appellant', as per the 'approved Resolution Plan', a sum of Rs.46,400/- was paid to the 'Appellant', through a 'Cheque dated 10.02.2022' and further, that, the 'allocation' of a such amount to the 'Appellant', under the 'Re....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... payment', is in violation of Section 30 (2) (b) of the I&B Code, 2016, as the 'Appellant', would have received, the 'whole claim sum', in accordance with Section 53 of the I&B Code, 2016, as the 'Claim' of the 'Appellant', is not included in the 'Liquidation Assets' of the 'Corporate Debtor', being 'all sums due' to any 'workmen or employees' from the Provident Fund. 19. The Learned Counsel for the 'Appellant', refers to the 'Judgment' of this 'Tribunal', in Regional Provident Fund Commissioner - I v Ramachandra D. Choudhary vide Comp. App. (AT) (Ins) No.1001 of 2019, wherein it was observed that Section 14B & 7Q and other PF dues, cannot be diluted by the 'Resolution Applicant' and the same is as under: - 44. "However, as no provisions of the 'Employees Provident Funds and Miscellaneous Provision Act, 1952' is in conflict with any of the provisions of the 'I&B Code' and, on the other hand, in terms of Section 36 (4) (iii), the 'provident fund' and the gratuity fund' are not the assets of the 'Corporate Debtor', there being specific provisions, the application of Section 238 of the 'I&B Code' does not arise. 45. Therefore, we direct the 'Successful Resolution ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rous 'Creditors' and 'admitted' the same. The said details run as under: - Financial Creditors: - (Amount in Rupees) S. No. Name of Financial Creditor Amount of Claim Amount Admitted by IRP 1. State Bank of India 3,68,54,47,056 3,68,54,47,256 2. IDBI Bank Limited 2,31,49,63,100 2,31,49,63,100 3. UCO Bank (Asset Management Branch) 17,38,14,812 17,38,14,812 Total 6,17,42,24,968 6,17,42,24,968 Operational Creditors:- (Amount in Rupees) Sl. No. Name of the Operational Creditor Amount of Claim Amount Admitted by IRP 1. Employees Provident Fund Organization 40,09,102 18,46, 674 2. Goods and Services Tax 7,12,98,098 7,12,98,098 3. Exercise and Taxation Officer, Panchkula 64,54,711 64,54,711 Total 8,17,61,911 7,95,99,483 Grand Total (i + ii) 6,25,59,86,879 6,25,38,24,451 That besides these claims no other claims were received within the stipulated time. c. That valuation of the Corporate Debtor as ascertained from the Registered Valuers by the RP is as under: - S. No. Asset Class Name of the Valuer Liquidation Value in (Rs.) Avera....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ent offered to financial creditors/operational creditor/CIRP expenses 6.00 28. Be it noted, the interests of all 'Stakeholders', in the 'successful Resolution Plan' in what manner, it is dealt with, is mentioned in the 'Tabular Form', as under:- Sl.No. Name of Creditors / Expense Claims admitted (Rs.) Total payment as per Resolution Plan (Rs.) 1. CIRP Expenses (Assumed) 30,00,000/- 30,00,000/- 2. Operational Creditors (Workmen / Employees / Suppliers / Vendors) 0.00 0.00 3. Secured Financial Creditors 617,42,24,968/- 5,50,00,000/- Operational Creditors (Statutory Dues) 7,95,99,483/- 20,00,000/- Total 625,68,24,451/- 6,00,00,000/- 29. As a matter of fact, the 'Implementation Schedule', is described as follows: - S.No. Actionable Time Lines (in days unless specifically mentioned) 1. Date of the Adjudicating Authority's approval of the Resolution Plan and constitution of the Supervisory Committee X 2. Opening / Identification of Designated Account in the name of the Corporate Debtor X+3 3. Change in Management of the Corpo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hereby for to all 'Creditors'; b) For 'promoting' an 'Entrepreneurship', availability of 'Credit'; and c) Balancing the 'interest' of all 'Stakeholders'. The I & B Code, 2016, is for `Reorganisation' and `Insolvency Resolution' of `Corporate Persons', `Partnership Firms' and `Industries', in a `Time Bound' manner. Ofcourse, `Speed' is the gist of the Code. 36. The 'pros and cons' of the 'Scheme' / 'Resolution Plan', is required to be thoroughly 'scrutinised', regarding a 'subjective satisfaction', being arrived at, by an 'Adjudicating Authority'. A 'Resolution Professional' is to find out, whether the 'Resolution Plan' of a 'Resolution Applicant', satisfies the 'requirements', mentioned in 'Section 30 (2)' of the I&B Code, 2016. 37. It is pointed out by this 'Tribunal', that 'Clause 11' of the 'Resolution Plan' (refers to the grant of the 'Reliefs', pertaining to 'Concessions' and 'Disposals', etc.), and according to the 'Resolution Professional', the same will ensure that the 'Corporate Debtor', will run as a 'Going Concern', falling in line, with the 'Aim' and 'Objectives' of the Insolvency & Bankruptcy Code, 2016. 38. In the 'instant case', the 'Adj....
X X X X Extracts X X X X
X X X X Extracts X X X X
..../ 'Partners' of the 'Corporate Debtor'. Further, the 'Unsecured Financial Creditors', shall be paid, before the 'Workmen' and this is meant to 'Promote' an alternative 'Sources of Finance' and consequent 'Development' of 'Bond Market in India'. 42. In the present Case 'on hand', the 'Adjudicating Authority', in the 'impugned order' dated 10.01.2022 in IA No.746/2021 in CP (IB) No.326/7/HDB/2020 (filed by the 'Resolution Professional'), at Paragraph No.21, had clearly mentioned as under: - 21. "However, the Resolution Plan approved shall not construe any waiver to any statutory obligations / liabilities arising out of the approved Resolution Plan and the same shall be dealt in accordance with the appropriate Authorities as per relevant Laws. We are of the considered view that if any waiver is sought in the Resolution Plan, the same shall be subject to approval by the concerned Authorities. The same has also been held by Hon'ble Supreme Court in the case of Ghanashyam Mishra and Sons Private Limited Versus Edelweiss Asset Reconstruction Company Limited." 43. In this connection, this 'Tribunal', worth 'recalls' and 'recollects' the 'decision' of the 'Hon'ble Supreme Cou....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Association and Others v. NBCC (India) Limited and Others (2022) 1 SCC 401" 45. An 'Analytical Subjective Satisfaction', to be arrived at by an 'Adjudicating Authority', ('Tribunal'), being a 'Condition Precedent', before according an 'approval' of a 'Resolution Plan'. The 'Adjudicating Authority', (`National Company Law Tribunal', Hyderabad Bench, Hyderabad), after going through the 'Resolution Plan', affirmed that, it satisfies, the requirements of not only the 'Insolvency & Bankruptcy Code, 2016, but, also, the requirements prescribed by the 'Insolvency & Bankruptcy Board of India'. Significantly, the 'Adjudicating Authority' (`National Company Law Tribunal', Hyderabad Bench, Hyderabad) had found that the 'Resolution Plan', had provided for 'Management' of the affairs of the 'Corporate Debtor', after the 'approval' of the `Resolution Plan', as per Section 30 (2) (C ) of the I & B Code, 2016 without any 'qualm of doubt', this 'Tribunal', points out that the 'Adjudicating Authority', ('Tribunal') has 'power' to examine the 'Resolution Plan', as approved by the 'required percentage' of 'voting share' of the 'Financial Creditors', which is 'limited'. 'The Adjudicating Authority' ....